Online apparel retailer SurfStitch Group goes into voluntary administration
Australian online sportswear retailer SurfStitch Group has collapsed into administration due to legal cases and the declining share price.
Currently facing litigation by entities in the Crown Financial group with regard to contractual disputes, SurfStitch has appointed John Park, Quentin Olde and Joseph Hansell of FTI Consulting to oversee the administration process.
Two class actions related to the contract and financial predictions made by the company are pending in the Supreme Courts of Queensland and New South Wales.
SurfStitch Group chairman Sam Weiss said: “The appointment of administrators to the listed and holding entities will allow our operating companies to focus solely on trade and the provision of a rewarding experience for our customers going into the critical December peak period."
An investigation by corporate regulator Australian Securities and Investments Commission (ASIC) is also underway.
The company noted that prolonged legal battles have affected the trading performance of the group, leading to uncertainty.
FTI Consulting senior managing director John Park said: “The legal proceedings against the non-operating SurfStitch companies will be stayed following the appointments, which will provide the group with breathing space to focus on trading into the critical December peak period.”
The administration process is not expected to impact operations of the company’s subsidiaries, including online divisions SurfStitch, Surfdome, SWELL, Magic Seaweed and STAB.